Shropshire Local Transport Plan 3 Evidence Base Part 3: Economy and Growth February 2011

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Shropshire Local Transport Plan 3 Evidence Base Part 3: Economy and Growth February 2011 Shropshire Local Transport Plan 3 Evidence Base Part 3: Economy and Growth February 2011 1. Shropshire economic portrait1 Business & enterprise Shropshire has a predominantly small business economy, with 87% of businesses employing 10 or fewer staff (compared to 85% nationally and only 2.5% of business having over 50 employees (compared to 3.5% nationally), a higher percentage than any of our statistical (or regional) neighbours. Figure 3.1 Penetration of small businesses. Statistical neighbours 2008. However, there are a few major employers which account for a disproportionately large share of the county workforce. In some smaller market towns in particular, there is heavy reliance on a small number of large employers, which can mean that the choice of employment opportunities is narrow. It also leaves these towns vulnerable should one of the main employers go out of business or relocate. There are high levels of enterprise and entrepreneurship; with higher than average new VAT registrations, and good rates of business survival. Shropshire has high levels of self- employment, 11.8% in Shropshire compared with 9.2% nationally. Many self-employed have home based businesses, Shropshire ranks second in the UK for home-based enterprise. The nature of business enterprise in Shropshire reflects its rural character with agriculture, farm diversification and tourism playing an important part and employing significant numbers of people. Although the structure of the economy has changed significantly over the last two decades, with the emphasis increasingly on service industries rather than agriculture and manufacturing, many of Shropshire’s key sectors today have their origins in the land. Like many other rural economies, Shropshire has a greater than average dependence on public sector employment, which may undermine the overall economic stability of the county once the expected sharp reduction in public sector budgets occurs. At the current time, around one in three workers in Shropshire is employed by the public sector. 1 Spotlight on the Shropshire Economy, Draft for Consultation, June 2010 2 Figure 3.2 Breakdown of Shropshire employment 2001 & 2008 Shropshire has several key sector specialisms. The high quality and diversity of local ingredients has given rise to a thriving food and drink industry. The food manufacturing industry currently accounts for more than 3% of total Shropshire employment, and some of the county’s key employers operate within this sector. Other key sectors which underpin the overall economy include environmental technologies and creative industries as well as tourism. However, productivity in Shropshire is low, and it has been growing at a comparatively slow pace. This partly reflects the fact that many high earners commute out of the county to work, and partly a traditional dependence on agriculture and related sectors with low productivity rates. Figure 3.3 GVA per head. Shropshire’s statistical neighbours 2007 The Shropshire economy is over-reliant on sectors which are forecast to decline in the future. There has been and a relatively slow up-take in knowledge based sectors which are expected to be the main focus of economic growth in the future. 30% of employees work in the knowledge economy, compared to 40% nationally, and the proportion is declining. 3 Further expansion of the knowledge sector will require improvements to ICT, as currently Broadband connections and speed are inadequate in some areas and there is a lack of a universal mobile phone network. Labour market Figure 3.4 Breakdown of Shropshire resident employees by occupation 2008 Shropshire’s resident profile demonstrates a higher proportion of people in managerial and senior positions than either the West Midlands or the UK, with 16.5% being employed in these occupations in 2009 (year ending June) compared with 14.7% in the West Midlands and 15.6% in the UK. However, a high proportion of Shropshire residents working in these top level positions work outside the county. On average workers in Shropshire have significantly lower wages than those in other areas in 2008, average weekly workplace earnings stood at £410 compared with £449 in the West Midlands and £479 in the UK. In this respect, Shropshire is ranked 15th worst in the UK. Figure 3.5 Median gross weekly workplace earnings. Shropshire’s statistical neighbours 2009 However residents’ average weekly pay is much closer to the regional and national average reflecting the fact that a significant proportion of high skilled, and better paid, workers commute out of the county to work. For local workers, higher than average house prices combined with lower than average wages create significant affordability issues. 4 Worklessness Unemployment rates in Shropshire are relatively low; although there are pockets of high unemployment in some towns, and youth unemployment is rising. However, lower claimant rates to some extent disguise a significant level of rural under-employment. A relatively high proportion of jobs are part-time (35.5% of jobs in Shropshire were part-time in 2007 compared with 31% in the UK), and there is a substantial amount of seasonal and casual work (both tourism and agriculture related). Many people work two or three part time jobs to make ends meet. Figure 3.6 JSA claimant count in Shropshire 1988-2009 Although worklessness in Shropshire is clearly not as widespread as it is in many more urban areas, there are some areas where worklessness is significant, affecting more than a quarter of the working age population. Specifically, long term unemployment is a major issue in parts of the former wards of Harlescott, Meole Brace and Sundorne in Shrewsbury and in part of Castle in Oswestry. Overall, a tenth of the working age population in Shropshire is currently claiming work- related benefits. Although this proportion is lower than it is in either the West Midlands or Great Britain, it still amounts to a sizeable 17,070 people (August 2009) 5 2. Economic Development Strategy To address these economic challenges Shropshire’s economic development policy is currently focussing on improving skills, restructuring of the economy, growing Shropshire's existing businesses and supporting start-up enterprises. There is a focus on the elements of our key sectors which have been identified as capable of significant growth, which include: • Tourism • High tech manufacturing, including food & drink and other land-based industries • Care/assisted living • Environmental technologies • Creative industries - particularly the design and new media sub-sector • High-quality, independent retail; particularly in Shrewsbury To support our economic development strategy Shropshire requires a modern, sustainable and affordable transport system. Development of better ICT infrastructure is also essential particularly in rural areas to support the modernising of the economy, increase competitiveness and reduce the need to travel. Local business have identified that high quality of life, good environment and a central location are strong assets of operating a business in Shropshire. Access by car is seen as being relatively good although parking cost and availability is an issue of concern, and some trunk road improvements are called for. Congestion is not considered to be a significant problem except in a few ‘hot spot’ areas, predominantly in and around Shrewsbury. Businesses do not consider public transport currently meets the needs of themselves or employees, with better access to rail and better reliability called for; and the lack of public transport for those working shifts (particularly in the manufacturing, care and hospitality sectors) highlighted as particular issues. 6 3. Tourism Tourism is a growing sector for the Shropshire economy. Shropshire has around 10.6 million visitors per year, spending £561M; supporting in the region of 15,691 jobs. 2 The tourism sector has a strong reliance on good transport provision, as well as generating significant volumes of traffic. In addition specialist tourist activities such as sightseeing by car; walking; cycling and horse riding have specific requirements and impacts as they utilise the highway and wider right of way networks. Cycling and walking have also been identified as important parts of the tourism offer for Shropshire, with the quiet lanes and by-ways offering a high quality experience. Maintaining quiet routes for such tourism is important. The majority of visitors to Shropshire are day visitors (76%3--88%4). The over two thirds of day visitors are from the West Midlands region (67%). The North West region (13%) and Wales (13%) are the next biggest suppliers of day visitors to Shropshire.5 The 2007 Shropshire visitor survey6 found that the majority (86%) of visitors arrive in Shropshire by car which is above the regional average. Only 6% of visitors to Shropshire used public transport as their main mode of transport to the area. The most visited towns and villages were Shrewsbury, Bridgnorth and Ludlow. When visitors were asked unprompted what they liked about Shropshire the high quality, tranquil rural and historic environment dominated the responses, including such phrases as countryside, nature, scenery, picturesque, old and peace & quiet. When asked what had spoilt their visit, whilst 77% said nothing, 2% of visitors mentioned road works or traffic, 2% referred to the lack of or cost of parking and 1% to lack of /poor signing. Making transport related issues the most significant problems identified other than poor weather. However,
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